Life insurance law called ‘monumental win’ as Gov. Scott signs

Florida has become the first state in the nation to impose sweeping requirements for life insurance companies to search death files to make sure families get benefits, state officials said as Gov. Rick Scott signed the bill Tuesday.

Florida insurance commissioner Kevin McCarty called it a “monumental win.”

Florida consumers already have recovered $500 million in benefits from a limited number of insurers in multi-state deals, but the bill imposes requirements on all life insurers operating in the state and could result in hundreds of millions of dollars in additional benefits, supporters say.

“This consumer friendly bill will ensure that when family members take steps to provide comfort and financial protection by purchasing life insurance, that companies ensure those beneficiaries receive what is due,” Hager said in a statement.

Another $250 million could be paid “in the near future,” Hager said.

Over the years, many life insurance companies have waited to be contacted by a beneficiary, rather than researching whether the policyholder is still living, according to state officials. If the company is never contacted, it never pays, they say.

“This is a monumental win for the state of Florida in addressing an inequitable industry-wide claims practice in the life insurance industry that was uncovered more than five years ago,” McCarty said.

He credited the joint efforts of Chief Financial Officer Jeff Atwater, Attorney General Pam Bondi and his office, among others.

“Today’s new law makes sure all life insurance companies doing business in Florida will abide by the same guidelines in their searches for beneficiaries, meaning more life insurance benefits will be discovered and returned to their rightful owners where they belong,” McCarty said.